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Some would say that pricing is the most critical element of the marketing mix (Product, Price, Place, & Promotion) for the service industry. I would have to say that a pricing strategy to increase revenue is absolutely critical to the success of your business. The importance of your pricing strategy compared to the other “P”s in the marketing mix will vary. But, since this article is about PRICING, let’s jump in.
Pricing done right will increase sales and profits. Done incorrectly and you’ll be leaving money on the table at the least, and closing your business at the worst.
There are many pricing strategies and tactics that can be incorporated into your sales process. Of all the pricing tactics available, not all will be relevant or effective for your business.
You probably employ a number of these tactics already. Each tactic should fit into your overall pricing and marketing strategy.
There is no single right answer to these questions. It depends on your market, clients, competition, and many other influencers. One thing is certain though, when answering these questions, it is important to take a Systems Approach and apply the pricing tactics within an overall framework of a pricing strategy.
“How much the customer is willing to pay for the product has very little to do with cost and has very much to do with how much they value the product or service they’re buying,” says Eric Dolansky, Associate Professor of Marketing at Brock University in St. Catharines, Ont.
Knowing which pricing strategies you can use and when is unique to each business. My goal in this writing is to bring to your awaerness that there are many pricing strategies available to you and hopeefully stimulate a desire to learn more.
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